SHARE
COPY LINK
For members

PROPERTY

How to get the best rate on your mortgage in Sweden

With interest rates increasing and the cost of living getting more expensive, you may be wondering how you can save money on what is most likely your largest household expense: your mortgage. Here are The Local's tips.

How to get the best rate on your mortgage in Sweden
Photo: Fredrik Sandberg/TT

Plan ahead

The work to find the best interest rate should start before you’ve even bought a property. Prior to buying a property in Sweden, you need a lånelöfte or lender’s note, a provisional agreement from a bank that you can buy a property up to a set value, with a maximum monthly running cost or fee.

Although you can buy a property with just one lender’s note, try to get a few from different banks, as this will make the process of actually applying for a mortgage quicker and easier when you’ve successfully bid on your dream home.

This will also provide you with peace of mind, as you will have an alternative to fall back on if one of the banks rejects your mortgage application despite previously giving you a lender’s note (which is entirely legal).

Try and get a maximum of two or three lender’s notes – each lender’s note requires a seperate credit check, and it can affect your credit score if you have too many checks within a short period of time.

You can also get around this by using a service such as Ordna Bolån or Lånekollen, who contact multiple banks on your behalf but only check your credit once.

Do your research

This includes using price comparison tools such as Compricer or Konsumenternas, but also looking at individual websites of mortgage providers and comparing interest rates there.

If you’re a member of a trade union, check if you’re offered a discount at a particular bank, as well as if your property qualifies for any other discounts, such as rewards for energy-efficient properties.

Many banks have a calculator on their website allowing you to use a sliding scale to alter the size of your deposit and see how that affects your interest rate, so make sure to have a look to see if you can get any discounts there, too. Some banks will offer you a discount if your belåningsgrad (the size of your loan compared to your deposit) is lower, so consider buying a slightly cheaper property or putting in more cash, if you can.

Make sure you know exactly how long any discount or reduced rate will apply for. Why not set a calendar reminder for this date, so you’ll be ready to renegotiate once the original offer expires? Either way, make sure you renegotiate your terms regularly so you’re confident you’re still getting the best deal.

Be prepared to negotiate

You may be able to negotiate a better offer than what is offered online, especially if you set up a meeting with a mortgage advisor directly. Don’t be afraid to say that a competitor is offering you a better rate, if that’s the case, and ask how they can match it.

It’s also important to find out what requirements your bank has for offering you a lower rate. Would you have to take out expensive insurance, open an account with an expensive card or move your pension to their bank? Check in advance how this compares to what you currently pay for these services, so you know whether they’re offering a better deal.

Don’t be afraid to take any information (either digital or printed) with you to your meeting so you can easily compare different offers.

Finally, keep in mind that a mortgage advisor is ultimately a salesperson, trying to sell you a product. Remember that they have a vested interest in getting you to sign up to expensive add-ons or take out a fixed-rate mortgage at a higher rate, so ask for time to mull over their offer and look through any agreements in your own time at home.

By Catherine Edwards and Becky Waterton

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.
Paywall free

PROPERTY

The ultimate guide to property in Sweden

At The Local, we've spent years writing articles on almost every aspect of buying, renting, and selling property in Sweden, from apartments to villas to summer houses. Here's our ultimate guide.

The ultimate guide to property in Sweden

Selling your property

Wondering how to sell your property in the current market, what fees you will have to budget for or how to prep your apartment for sale? Look no further.

Buying a property

How do I buy an apartment in Sweden? What vocab do I need to know? Is now even the right time to buy? Read the answers to those questions here.

Here are a couple of articles on mortgages in Sweden:

Renting in Sweden

How can you avoid long waits for rental apartments? Should I buy or rent? How do I join the housing queue? Find out in this section.

Your rights

Here are our articles on your rights when renting in Sweden.

Summer house or kolonilott

Wondering about the rules for buying a summer house, or what a kolonilott is? Find out here.

House prices

Why are house prices going down? Find out our articles on dropping house prices here.

SHOW COMMENTS